New Tax code: What is in it for you?

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Pranab Mukherjee
New Delhi, Aug 13: The new tax code draft submitted by the Finance Minister, Pranab Mukherjee on Tuesday, Aug 12 does not only be a simpler process of taxation, it also means that a commoner will retain more money on his/her hands.

The sweeping reforms not only promise better changes in terms of increase in tax slabs and wealth tax and fewer exemptions, it gets tough with evaders. Finance Minister who claims to have based this draft on the best global practices, but what does it do for individual?

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For one the tax savings has been raised to Rs 300, 000 from Rs 100,000 and the wealth tax limits are raised to Rs 50 crore and a tax of 0.25 per cent is applied above this limit.

However, on a flip side home loans could become fully taxable. Perks and bonuses will be construed as salary and can be taxed.

One area that saw a lot of focus is the change in proposed slabs. Following are the details:

For Males

IncomeExisting TaxProposed Tax
Up to 1,60,000NilNil
1,60,001 - 300, 00010pc10pc of amount by which total income exceeds lower limit
3,00,001 - 5,00,00020pc10pc of amount by which total income exceeds lower limit
5,00,001 - 10,00,00030pc10pc of the amount by which total income exceeds Rs 1,60,000
10,00,001 - 250000030pcRs 84,000 plus 20pc of the amount by which total income exceeds Rs 10,00k
Above 25,00,00030pcRs 3,84,000 plus 30pc of the amount by which the total income exceeds Rs 25,00,000

For Females

IncomeExisting TaxProposed Tax
Up to 1,90,000NilNil
1,90,001 - 3,00,00010pc10pc of the amount by which the total income exceeds Rs 1,90,000
3,00,001 - 5,00,00020pc10pc of the amount by which the total income exceeds Rs 1,90,000
5,00,001-10,00,00030pc10pc of the amount by which the total income exceeds Rs 1,90,000
10,00,001 - 250000030pcRs 81,000 plus 20% of the amount by which the total income exceeds Rs 10,00,000
Above 25,00,00030pcRs 381,000 plus 30% of the amount by which the total income exceeds Rs 25,00,000

For Senior Citizens

IncomeExisting TaxProposed Tax
Up to 2,40,000NilNil
2,40,001 - 3,00,00010pc10pc of amount by which total income exceeds Rs 2,40,000
3,00,001 - 5,00,00020pc10pc of amount by which total income exceeds Rs 2,40,000
5,00,001 - 10,00,00030pc10pc of amount by which total income exceeds Rs 2,40,000
10,00,001 - 250000030pcRs 76,000 plus 20pc of the amount by which the total income exceeds Rs 10,00,000
Above 25,00,00030pcRs 3,76,000 plus 30pc of the amount by which the total income exceeds Rs 25,00,000

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